I. World Food System of Surplus Creating Shortage

Currently the world system of food production and supply is riddled with contradictions and is on the brink of total collapse. On the one hand are those countries export-dumping their surplus food supplies by attaching subsidies, while on the other hand, according to FAO, are 840 million malnourished or starving people, which is approximately one seventh of the world population.

Major agricultural countries which export-dump are wealthy industrialized countries while those facing starvation are the poorer developing countries. However, even within the internal structure of these industrialized countries are contradictions. In the US, the world's largest economic and military superpower, there are over 30 million people suffering from malnutrition. The US government is helping to create a wider gap between the haves and have-nots by pushing welfare reform and a thorough, market-driven economy. The number of people who cannot afford to eat is increasing.

The US is also an agricultural superpower. However, there is a contradiction inherent in its structure of agricultural production. Under an agricultural policy of exports taking precedence above all others, price support systems have been reduced and middle- and small-scale farmers have been disappearing due to a fall in agricultural prices. On the other hand, monetary compensation in the form of direct income support has targeted large-scale producers as their primary recipients, creating surplus products and export-dumping into food-importing countries. When we consider the fact that surplus production promotes destruction of the environment such as soil erosion, nitrogen contamination, and the depletion of ground water, subsidized exports of agricultural products not only means price-dumping but also environmental dumping. Similar structures are also in place in Europe.

These aggressive agricultural strategies of major agricultural exporting countries not only destroy their own domestic family-operated farms, but destroys small-scale agriculture around the world in other countries as well. The fact that they produce trade friction with agricultural importing countries like Japan as they destroy agricultural production in the importing countries is evident in our report "Overview of Japan's Agriculture and Agricultural Policies".

However, developing countries are facing even worse damage. According to Kevin Watkins, a senior policy advisor at OXFAM-United Kingdom and Ireland, overproduction and subsequent export-dumping of agricultural products have created a structure of dependence on imported foods among developing countries. Dependence created on imported cheap grains from the US and Europe in Africa is a well known typical example, and the same situation is repeated throughout Asia and South America.

Small-scale farmers in such a predicament have no choice but to abandon their lands. Food production will be renounced, and such countries end up relying on imported products, or starve without the capital to purchase food. The abandoned land either decays into desertification or becomes cultivated for commodity produce. Concentrated cultivation of single crops will expand, pillaging natural resources and destroying the environment in the process. Such developing countries do not possess the capital to fund the support systems for compensation for agricultural income. Small-scale farmers who practice traditional agriculture and had long been supplying basic food for the domestic market are now thrown into the international market without the means to fend for themselves.

The multinational agribusinesses are the ones controlling the international markets. In the field of grain exports, the US has an overwhelming proportion of the markets for maize (76%) and wheat and flour (34%). It could be said that the world trade in grains rests on the shoulders of the US. On top of this, over 80% of these US grains are being monopolized by a small number of grain corporations. Not only that, these multinational agribusinesses are placing their employees in positions which could influence policy making, such as US Government. Furthermore, these agribusinesses are developing contract cultivation world wide, entering into the process of production and thus crushing small-scale farming.


II. Establishment of the Small-Scale Agriculture Protection Fund

If we try to ensure food security for all people in the world, we must revitalize small-scale agriculture. It not only means securing a food supply for individual regions, but helps in the prevention of further destruction of the natural environment as well. That being our aim, we propose the following.

1. We will confirm the following items in the establishment of the Fund

(1) That no matter where we live, people have the basic right to acquire nutritious food and clean water.

(2) That self-sufficiency in food is vital for realizing the above mentioned right, which is a right of each nation as well as individual farmer.

(3) That agricultural producers have the right to produce food for as long as they like. To achieve this, the rights of small-scale producers to own and determine the use of land must be established.

(4) The food supply system, which is increasingly being controlled by multinational agribusinesses, must be regulated globally. The rights of farmers to determine the use of production resources and sales of their products must not be infringed upon.

(5) That the huge amount of export subsidies provided by some industrialized countries and regions such as the US and EU must be dismantled in principle.

2. Establishment of the small-scale agriculture protection fund

(1) Industrialized nations must provide equal or half the cost intended for the export subsidies and direct income supports as funding for revitalizing small-scale farming.

(2) Establish a Small-Scale Agriculture Protection Fund from the contributed capital. The Fund will be established under such UN institutions like UNCTAD which will reflect the interests of developing nations, cooperate with NGOs and agricultural groups from both contributed and contributing nations and adopt an open-door policy in its operations.

(3) Disbursement of loans and assistance from the Fund will be conducted by small-scale farmer's cooperatives.

3. The Aim and Utilization of the Fund

(1) The Fund will generally operate as a source of low-interest or no-interest loans, but in terms of aid to developing countries seeking self-sufficiency, it will be disbursed for a certain period of time without compensation.

(2) The Fund will be used for the achievement of the following goals.

a. Revitalization or creation of small-scale, environmentally safe agriculture which provides products for domestic consumption.

b. Self-sufficiency of the farmers for basic food items

c. Creation of small-scale agriculture cooperatives.

d. Development and popularization of agricultural technology which is in harmony with the ecosystem and natural environment.

(3) Conditions for application

a. Management assistance and living expenses for small-scale farming families producing environmental and ecosystem-friendly products in developing countries.

b. Funding for the creation of small-scale farmers' cooperatives, as well as development and implementation of environmental and ecosystem-friendly farming techniques.

According to OECD data, in 1994, the total amount of agricultural subsidies provided by OECD member countries was about US$175 billion (in 1995 the amount was US$182 billion). Kevin Watkins states that this amounts to virtually half of the world's gross agricultural product. Calculated on a per full-time farmer basis, US subsidies were US$ 16,000/farmer and EU subsidies US$ 18,000/farmer. In 1995 Japan contributed 3.5 trillion yen (or US$29.2 billion) as agricultural subsidies, which according to the Uruguay Round (UR) agreement must be reduced. On the other hand, the total amount of overseas food aid peaked in 1988 at US$ 4 billion and has steadily decreased since.

We would like to declare our willingness to forfeit a part of our subsidies in order to help the existence and productive activity of small-scale farmers worldwide and that the reform of food systems begins with pressuring the government to take action. The protection of small-scale farmers in developing countries ultimately means the survival of farmers in industrialized countries, since protecting the food supply of each regions is the only way to prevent free trade of agricultural products and stop the ambitions of multinational agribusinesses dead in their tracks.

For the purpose, not only is it important to establish this Fund, but also to demand an establishment of a code of conduct for the multinational agribusinesses, which clearly define their accountabilities and social responsibilities. As a concrete plan of action, there should be a small-scale farmer's support center, as well as an agribusiness information center under the jurisdiction of the UN or FAO, where surveillance and warming system for the incidents such as starvation export (where starvation-ridden countries export their food for monetary gains) and prosecute large-scale and parasitic land holders would be undertaken.